Financial Sector Omnibus Law Series – General Overview

On January 12, 2023 the House of Representatives (Dewan Perwakilan Rakyat or the  “DPR”)  has issued Law No. 4 of 2023, regarding Development and Strengthening of the Financial Sector (the “Financial Sector Omnibus Law”).  The Financial Sector Omnibus Law is over 800 pages and contains 27 chapters and 341 articles that will replace and amend 17 laws in the financial sector. The Financial Sector Omnibus Law took effect as of January 12, 2023.

The issuance of the Financial Sector Omnibus Law lies on the urgency to create a more inclusive and efficient financial sector to support economic growth. By doing so, the Financial Sector Omnibus Law amends several provisions across multiple sectors and institutions such as; banking, capital market, pension funds, Rural Banks (Bank Perkreditan Rakyat or “BPR”), and insurance. It is worth noting that for several regulations, especially those that affect the public, require consultation or approval from the DPR.

We highlight the pertinent changes introduced by the Financial Sector Omnibus Law to the Currency Law, the Financial Services Authority Law, and the Banking Law below:

  1. Currency Law

In addition to the Rupiah paper money and coins, the Financial Sector Omnibus Law introduces Digital Rupiah as a means of currency in Indonesia. The Management of Digital Rupiah which includes planning, publishing, distribution, and the accounting shall be the sole authority of Bank Indonesia.

  1. Financial Services Authority (Otoritas Jasa Keuangan or “OJK”)
    • Regulating and Supervision of Cryptocurrencies by OJK

The Financial Sector Omnibus Law introduces an additional task to OJK in relation to its regulating and supervision towards among others; banking, capital market, and insurance sectors namely Financial Sector Technology Innovation (Inovasi Teknologi Sektor Keuangan or “ITSK”) and digital financial assets and crypto assets.

    • Bankruptcy and PKPU Petitions by OJK

OJK is now the sole party authorized to submit an petition for declaration of bankruptcy and/or petition for suspension of debt payment obligation (PKPU) against debtors that are Financial Service Institutions (Lembaga Jasa Keuangan or an “LJK”), i.e., Banks, securities companies, stock exchanges, or other LJKs which are registered and supervised by the OJK) insofar that their dissolution and/or bankruptcy are not regulated separately in other Laws.

    • Introduction of Supervision Body of OJK

The Financial Sector Omnibus Law introduces the establishment of the Supervision Body of OJK (Badan Supervisi OJK) in order to aid the DPR’s supervision on OJK. The Supervision Body is given authority to: draw up evaluation reports on performance of OJK, carry out monitoring of OJK, and drawing up performance reports.

  1. Banking Law
    • Strengthening the Functions and Roles of People’s Economic Banks

There is a change of terminology Rural Banks from a Bank Perkreditan Rakyat to Bank Perekonomian Rakyat or “BPR”. The Financial Sector Omnibus Law also extends the authority of a BPR to include;  carrying out business activity of foreign currency exchange,  carrying out fund transfer activities, cooperate with other LJK to their customers, which was previously prohibited to be conducted by BPR.

We continue to review the amendments and additions regulated under the Financial Sector Omnibus Law, and shall circulate follow-up newsflashes in due course.

March 23, 2023


Please contact Johannes C. Sahetapy-Engel (, or  Datanya N. Kalula ( ).


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